3 Keys to Future-Ready Restaurants
Being nimble with technology has become more important as the pace of change in both technology and business as a whole has accelerated. While customer-facing innovation gets the lion’s share of attention, back-office systems must also foster flexibility to ensure restaurants are positioned for the future. In this exclusive one-on-one, John Moody, co-founder of Restaurant365 Software, a provider of restaurant-specific back-office and accounting software, shares insights into three keys to preparing restaurants for the future of business and operations.
What should restaurants ask of technology partners to foster flexibility?
JOHN MOODY: There are two aspects to this: First, restaurants should be asking technology partners what their roadmap is, both short term and long term, and if there is an avenue to make customization or enhancement requests. Some technology vendors may only do one system update every 12-18 months. Although that was acceptable five or 10 years ago, restaurants should be asking how often they release new features and functions, and how those are prioritized. I think updates and enhancements should be done on a regular basis (every few months at the most). There needs to be a strategy and a flexibility to add new features and functions to the system. Using modern coding technology allows new features to be implemented on a more regular basis.
The second aspect to technology partnerships is to ask vendors to play nice with other vendors. They should connect well with other restaurant technologies, even when there might be some overlap. The ability for them to connect and “talk” to each other is increasingly becoming more important. Gone are the days that invoices are inputted four times into four systems. Invoices should only be touched once, so platforms and integration should be conducive to this.
Systems integration continues to be vital for restaurants moving into 2018 and operators continue to put more expectations on the POS to be “all things” to the enterprise. What integrations to the POS do you consider to be must-haves? What should remain separate and why?
MOODY: The industry-wide expectation that the POS is to be “all things” is a fallacy. Excellent POS companies process transactions in-store in the most efficient and cost-effective way possible – transactions should be speedy and cost-efficient. Most POS companies have struggled to go beyond transaction processing and add things like inventory, scheduling, food costing, reporting, etc.
Thoughts towards POS has turned into, “We receive all this data at the POS, so we should be getting more data from POS companies.” I don’t think there should be the expectation that the POS should be all-things. It is a vital component of enterprise, but the POS should not become an inventory application or a scheduling solution. I would look to POS companies to do more things like loyalty and online order processing natively on their platforms.
Things that should be kept separate from the POS are anything related to accounting. We should not ask the POS to store invoice data – invoices should only be processed and paid in accounting.
Other people think the POS should be the brain or central nervous system from a technology perspective. POS is obviously vital, but typically those systems are not set up to run a business’ process.
As restaurants partner with third party delivery services how will this impact accounting practices? What should restaurants be mindful of to make sure financials remain in order?
MOODY: Third party delivery services are like any business function, and should be accounted for and measured. Most restaurants see third party delivery services as another way to increase revenues. While important, operators must measure the profitability of the use of these services. When restaurants use third-party delivery services without properly accounting for them, they may come to find out that they are not making as much margin as they thought, or are even losing money on them. Companies need to be able to measure the third party delivery services they use, and that they provide a profitable model. The ability to account can be a challenge, but Restaurant365 provides tools to give this visibility.
Having a holistic view of data is imperative for restaurants in order to make smart business decisions. Where have restaurants been lacking in harnessing data to yield actionable insights?
MOODY: Typically for most restaurants, it’s been a challenge to even attempt to harness a holistic view of all their data. Some restaurant groups have 10 to 15 or more systems. There are two approaches to this:
Extract, centralize and analyze. You can take the data out of each of the, say 15, systems, and centralize the all the information into a data warehouse or enterprise reporting solution. Some restaurant groups attempt this, but managing 15 integrations of anything is not easy. Once centralized, using a strong reporting solution to provide actionable insights.
You could also look at 10 or 15 systems and think, do we really need that many? There are better tools available today than there were ten, five or even one year ago. You should be able to take those 15 systems and get them down to just a few, maybe 3 core restaurant solutions. Look at those 15 systems and see what you can combine.